At times don’t you think that having a single currency would be better than the numerous ones? This might be possible soon in UAE and Saudi Arabia.
The UAE is working with Saudi Arabia’s central bank to issue a digital currency that would be accepted in cross-border transactions between the two countries, UAE Central Bank Governor Mubarak Rashed Al Mansouri said on Wednesday.
The digital currency would be based on the blockchain, the shared ledger of transactions that is maintained by a network of computers on the Internet rather than a central authority, he said in a speech to a regional financial conference.
The two central banks have in the past expressed skepticism about digital currencies such as bitcoin, with the UAE Central Bank saying it did not recognize bitcoin as an official currency. In July, the Saudi Central Bank warned against trading bitcoin because it was outside the bank’s regulatory reach.
On Wednesday, however, Al Mansouri said the central banks wanted to understand blockchain technology better. He told reporters that the UAE-Saudi digital currency would be used among banks, not by individual consumers, and would make transactions more efficient.
“It is the digitization of what we do already between central banks and banks,” he said.
A decade ago, the UAE and Saudi Arabia discussed the possibility of creating a single currency among members of the six-nation Gulf Cooperation Council but the UAE pulled out of the project in 2009.
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